TaxTMI 
TaxTMI 
2017 (12) TMI 1262
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....riod of four years in the absence of new tangible material is bad in law in view of the Hon'ble Jurisdictional High Court in the case of CIT v. Amitabh Bachan [349 ITR 76]. 3. Since the assessee has challenged the very validity of the reassessment order passed by the Assessing Officer, first we take up the issue of the assessee in the Cross objection. 4. Learned Counsel for the assessee submitted that the assessee firm namely M/s. Neha Enterprises was converted into Private Limited Company on 20.02.2008 and the name of the company was changed to M/s. Neha Home Builders Private Limited. Learned Counsel for the assessee referring to Page No. 51 of the Paper Book submits that the notice u/s. 148 of the Act was issued on 27.02.2012 in the name of M/s.Neha Enterprises which was a non-existing entity as the firm was already converted into Private Limited Company on 20.02.2008. Therefore, the Learned Counsel for the assessee submits that when the firm got converted into company the firm is no more in existence and therefore the assessment made by the Assessing Officer on the assessee firm a non-existent entity is null and void. Referring to the decision of the Delhi Tribunal in ....
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....tfully following the above decision, we hold that the issue of notice under Section 148 in the name of a dead person is void. It is not much relevant whether the Assessing Officer was aware or not with regard to dissolution of the firm. However, we may point out that the Revenue is at liberty to take appropriate action in accordance with law in the hands of the successor company in the light of the observations of Hon'ble Jurisdictional High Court at paragraph 18 of the report which is also reproduced by us at paragraph 12 above." 7. The Hon'ble Delhi High Court in the case of Spice Entertainment Ltd v. CIT in ITA.No. 475 and 476 of 2011 dated 03.08.2011 considered as to whether the assessment made on a non-existent person is valid or not; and a situation where the assessment made in the name of a company which had been framed and it had been dissolved with the amalgamating company will be null and void or not. The Hon'ble High Court by considering various decisions on the issue including provisions of section 292B held that the assessment made on a non-existent person is null and void observing as under: - "3. In this backdrop, the questio....
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....to mention the name of the appellant/amalgamated company in place of M/s Spice was, therefore a procedural defect covered by the provisions of section 292B of the Act. 5. According to the Tribunal, if the Spice was non-existent, there was no reason for the amalgamation company to represent the same or to feel aggrieved against the said order and preferred appeal and get the same decided on merits. In other words, any appeal preferred by a non-existence person must also be treated as non-est. All these acts of the appellants/ amalgamated company clearly show that it had been constantly treated the assessment made against the appellant in respect of the assessment of amalgamated company. Further, no prejudice is caused to the assessee merely because in the body of the assessment order name of the amalgamated company is not shown. 6. On the aforesaid reasoning and analysis, the Tribunal summed up the position in para 14 of its order which reads as under: "In the light of the discussions made above, we, therefore, hold that the assessment made by the AO, in substance and effect, is not against the non-existent amalgamating company. However, we do agree with t....
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....nt thereupon. In the case of Saraswati Industrial Syndicate Ltd. Vs. CIT, 186 ITR 278 the legal position is explained in the following terms: "The question is whether on the amalgamation of the Indian Sugar Company with the appellant Company, the Indian Sugar Company continued to have its entity and was alive for the purposes of Section 41(1) of the Act. The amalgamation of the two companies was effected under the order of the High Court in proceedings under Section 391 read with Section 394 of the Companies Act. The Saraswati Industrial Syndicate, the trans free Company was a subsidiary of the Indian Sugar Company, namely, the transferor Company. Under the scheme of amalgamation, the Indian Sugar Company stood dissolved on 29th October, 1962 and it ceased to be in existence thereafter. Though the scheme provided that the transferee Company the Saraswati Industrial Syndicate Ltd. undertook to meet any liability of the Indian Sugar Company which that Company incurred or it could incur, any liability, before the dissolution or not thereafter. Generally, where only one Company is involved in change and the rights of the shareholders and creditors are varied, it amoun....
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....ion of the scheme on 11th April, 2004, the Spice ceases to exit w.e.f. 1st July, 2003. Even if Spice had filed the returns, it became incumbent upon the Income tax authorities to substitute the successor in place of the said dead person. When notice under Section 143 (2) was sent, the appellant/amalgamated company appeared and brought this fact to the knowledge of the AO. He, however, did not substitute the name of the appellant on record. Instead, the Assessing Officer made the assessment in the name of M/s Spice which was non existing entity on that day. In such proceedings and assessment order passed in the name of M/s Spice would clearly be void. Such a defect cannot be treated as procedural defect. Mere participation by the appellant would be of no effect as there is no estoppel against law. 12. Once it is found that assessment is framed in the name of non- existing entity, it does not remain a procedural irregularity of the nature which could be cured by invoking the provisions of Section 292B of the Act. Section 292B of the Act reads as under: "292B. No return of income assessment, notice, summons or other proceedings furnished or made or issue or taken or ....
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....of Section 292B of the 1961 Act do not authorize the AO to ignore a defect of a substantive nature and it is, therefore, that the aforesaid provision categorically records that a return would not be treated as invalid, if the same "in substance and effect is in conformity with or according to the intent and purpose of this Act". Insofar as the return under reference is concerned, in terms of Section 140 of the 1961 Act, the same cannot be treated to be even a return filed by the respondent assessee, as the same does not even bear her signatures and had not even been verified by her. In the aforesaid view of the matter, it is not possible for us to accept that the return allegedly filed by the assessee was in substance and effect in conformity with or according to the intent and purpose of this Act. Thus viewed, it is not possible for us to accept the contention advanced by the learned Counsel for the appellant on the basis of Section 292B of the 1961 Act. The return under reference, which had been taken into consideration by the Revenue, was an absolutely invalid return as it had a glaring inherent defect which could not be cured in spite of the deeming effect of Section 292B of th....